The Heyday Challenge

The Advocate General has announced that UK national legislation that allows employers to retire employees at 65 or over, is not in breach of European law. This page has more details on Heyday and next steps.

The Advocate General's opinion means that the UK can set a mandatory retirement age. Following the decision, the High Court will now decide whether 65 can be justified as a retirement age. This is likely to happen early next year.

What does this mean for employers?

The outcome does not have any new implications for employers. However, organisations are advised to continue to apply good practice in relation to the Employment Equality (Age) Regulations.

The ageing population and changing demographics means that the need to attract and retain skilled employees continues to be a key issue for the NHS. By ensuring that procedures and processes are in place to enable employees to request extending their employment beyond the default retirement age, employers can help to retain a skilled workforce. See our age diversity pages for more details.

Background

The case, which was made by Age Concern's membership arm called Heyday, was referred to the European Court of Justice two years ago. Heyday argued that Employment Equality (Age) Regulations discriminate against older workers.

What is the default retirement age?

The default retirement age was introduced as part of the Employment Equality (Age) Regulations in October 2006 and should not be confused with the Normal Pensionable Age, which is when employees can begin to draw their pension via the NHS Pensions Scheme.

The default retirement age means that:

• It is lawful for employers to terminate the employment of an employee on the grounds of age when they reach the age of 65.
• Employers are required to introduce a process that enables employees who are approaching their sixty-fifth birthday to request that employment is extended beyond the default retirement age.
• Employers could incur costly penalties if this process is not carried out properly and within prescribed timescales.

What are employers doing?

NHS Employers sought feedback from employers to find out how they are responding to Employment Equality (Age) Regulations. The main findings were:

• Many employers no longer specify a retirement age for staff. Some trusts removed retirement age from their contracts at the time that age legislation was introduced and now simply require employees to give three month's notice.
• Where the default retirement age has been used, it has been applied uniformly to staff of all professional groups. Whilst the contractual age is 65, differences in when people actually retire occur through individual choice and the provisions of the pension scheme.
• Some organisations are taking advantage of the legal provisions to extend working lives and retaining skilled employees by introducing flexible working for staff of all ages. Many employees opt to work part time hours beyond age 65.
• There is limited evidence of any impact on opening up opportunities for training but some older employees are starting to consider retraining (for example, in nursing). The legislation has had most impact on external training providers who have had to demonstrate equal access regardless of age.